Good morning, everybody. Welcome to AeroVironment's Investor Day 2022. Thank you so much for coming out and joining us. We're really happy to have you. It's been four years since our last event and definitely the first one since COVID. Super nice to meet everybody in person, see everyone face to face. I know it's been a long time coming. We've got a packed agenda for you today. We will be having Kevin and Wahid talk about what's happened since we last got together and also where we see the future coming for the company. You will also get to hear from three of our vice president and general managers running the three largest business segments for AeroVironment. We're super excited for that. We're also gonna show off our MUAS facility, which was purchased in the Arcturus acquisition two years ago. It's the main reason we're having the event here today. Excited to show you that as well. Appreciate your help to keep things on task. We'll be doing that on our side, but just when we take breaks, make sure you're back on time and back promptly. For those of you who don't know me, I am Jonah Teeter-Balin. I head Investor Relations and Corporate Development for the company. I know we've exchanged a lot of emails. We've been on a lot of FaceTime calls and Zoom calls, et cetera, but really excited to be able to meet with you and talk with you in person today. Now to get everybody excited for why we're here. Somewhere out there, at a location you don't know, in a building you won't find, behind a door you can't open, is a laboratory, a headquarters, an above ground, underground proving ground for those who break ground, break rules, and break records, for making the things that make the modern warfighter and first responder more aware and secure, more capable and connected, better prepared, better protected. For over 50 years, this elite team of eggheads, gearheads, propeller heads, and heads of the class have been using aeronautics, astrophysics, biometrics, and other subjects you skip to save ounces and shave seconds, to get stronger and go longer, to move stealthier and stay safer, to put the right sized right tools in the right hands at the right time. That jaw-dropping, heart-stopping, game-changing tech that's tipping the scales in our favor today, we dreamed it, designed it, developed it, and delivered it, all before you even heard of it. Because our head space is your battle space, from cyberspace to outer space. If you're in charge of our frontline heroes, our first lines of D, know that every challenge has a solution, from A to V. All right. We're excited. Got a lot of good stuff to share with you today. First, I have to cover some of the boring stuff, so bear with me. Somewhere out- First, I just wanna mention that some of the content today may contain forward-looking statements under the Private Securities Litigation Reform Act of 1995. For more details on these risks, you can check out our 10-K, the risk factors discussed therein, and also our other periodic SEC filings. In terms of the agenda, I would now like to welcome Wahid Nawabi, our President, Chairman, and Chief Executive Officer, to talk you through where we've been and where we're going. Wahid? Thank you. Welcome. Thank you. Good morning, everybody. Thank you for making it out here. I'll try to keep this brief and succinct. Majority of the conversation today really is about where we're headed in the future and what our strategy looks like and why is this an exciting journey that we're really looking forward to it. We're excited about it. Our team is energized, and so I would like to actually take a moment to introduce some of our team members that are here, of our leadership team. You all know Kevin McDonnell, our CFO, who's been in the industry for well, CFO for pretty much almost all of his career. A business background, many different industries, and has been my partner in this for the last couple years with us so far. He also oversees IT, also oversees what we could refer to as people and culture, our HR department. So he's got a lot of other background experiences and expertise that is very helpful to the company. Jonah, you already know. Jonah Teeter-Balin. He's in charge of our corporate development as well as investor relations. Gorik Hossepian, who's gonna talk to you a few minutes later, has a presentation on medium UAS. We're in a medium UAS facility. He runs that business for us, the product line. Of course, his claim to fame for me is that there's not an airplane in the U.S. Air and Space and Defense that he doesn't have a part in it or some system or subsystem within that equipment. 30+ years of experience, lots of backgrounds and engineering background. A lot of our folks are engineers as well, so you'll see that. Trace Stevenson, who's in the back of the room, he's our general manager, Vice President in charge of our small UAS business or product line. He's been in the company for over 12 years, I think it is. 18 years, so way longer than I have been with the company. You'll see a lot of folks in this room that have been with us for quite a while. He runs our what I refer to as our largest product line in business, who's also our core franchise that we've built the company around over the last two decades. Spend time in finance. He's got a business background and understands the products. He's very familiar with the company and our products and our business as well. All of us, except Gorik now, really is out of our Simi Valley facility. We travel quite everywhere. Charlie Dean, who is standing back there, sitting there, Lieutenant Colonel Charlie Dean, I should say, retired, is our Vice President of Global Sales, Marketing, and Program Management, which relate to the customer side and field service representatives, field service reps. The training and demonstration of our systems that we do with our customers. Charlie has an extensive military background. Extensive. That's an understatement, actually. Also a engineer and MIT grad. Could have been a professor easily. Has an enormous amount of experience when it comes to unmanned systems, ground robots, UAVs. Really built that business for Endeavor Robotics, as you're familiar with them, which is now part of Teledyne. He's been with us for a few years, and really glad to have you with us as well. Trying to think of who else am I missing. Melissa Brown, who's sitting on the corner here or in the other side of the room, is our Corporate Vice President, Secretary of the company, and General Counsel. She also handles our facilities, compliance, as well as exports and contracts. A lot of different functions that has to do with supporting the business is part of her responsibility. Cindy, I saw her. Cindy is back there. Cindy Jacobson is the head of our marketing. Lot of experience as well. Brett Hush, I would say, who's sitting next to Cindy, is our VP and General Manager for Tactical Missile Systems, the Switchblade product line. He also has a similar background as many of the other folks that I mentioned in the room. And an engineer, I must say, and the two schools that I'm never gonna forget, Clarkson and Syracuse University, electrical engineer. He's been with our company. Actually, he started the Switchblade family of products for AV almost two decades, like at least a decade and a half, I would say, right? Roughly that long. Extensive background in aerospace and defense, knows a lot about our business and products. Okay, before I go any further. Oh, I'm sorry. Kristy, I missed Miss Kristy. She is our corporate treasurer and in charge of our finance and corporate finance and planning, FP&A. She's been with us for about two years now. Lots of different experiences, also based out of our Southern California office and works with Kevin and the rest of our team. I'm sorry, I for some reason just skipped right next to sitting next to that. I don't think I missed anybody. Anybody? No? Okay, great. Let's talk about our company and where we're going and what our strategy is. Before we go into the details of where we're going, I wanted to share with you a little bit about where we've come from in the last five years. I've been in this role for, this is my sixth year, I believe. We have really evolved as a company tremendously over the last six years. The credit goes to all our team members, the folks that I mentioned and the people behind them. Our geographical footprint has grown dramatically. You know, we were pretty much a Simi Valley, California-based company, six years ago, five years ago, even if you looked at us. A majority of our operations, our presence, our production engineering was all in Southern California. We also had a limited customer overseas. We were growing internationally, but we didn't, we were not close to 55 countries. We actually export to 55 countries around the world, primarily our small UAS and hopefully very soon, our tactical missile systems product line as well, and our medium UAS product line. Location-wise, we're quite global. We have facilities in Southern California, Northern California, various states. Headquarters is now in Arlington, Virginia, down in Crystal City. We have facilities and innovation centers in Boston area, New England. We have an innovation facility and innovation center in D.C. area outside of our corporate headquarters, where a lot of our autonomy and AI and machine learning engineering is based out of. We've got facilities in Huntsville, we've got facilities in Kansas, we've got a facility in Minnesota. Just in the United States, our footprint has really grown quite a bit with the growth. Also, we have a facility now in Germany, as you know. Near Stuttgart is where we manufacture and design all of our ground robots, which was an acquisition that we did. Our workforce has actually more than doubled. We were about sub 600 employees. We're now over 1,200 employees. Obviously, our revenue has more than doubled. We were, you know, south of $200 and some odd million, and we're now this year as we provided the guidance last quarter. I'm gonna steer clear of this quarter's financials because we're not in a quiet period, but I'd rather not discuss those things at this setting for the rules that Jonah just went over, a safe harbor statement. Our R&D investments are at record high levels and we are really outpacing competitors in almost every single segment of our business. If you look at it from a market share perspective, installed base, customer base, whatever metric you wanna look at, portfolio of our products is dramatically above, way above head and shoulders above our competitors in the market. Really, if you go in the industry and talk to our customers, we are the company that everybody wants to be compared to or used as a reference point. The credit really goes to our team. We're very proud of those accomplishments. We're not gonna stop here, and we're not satisfied yet. We're very proud of this. We believe the next five years is going to be even more exciting for us based on the opportunities that I'm gonna share with you and the strategy that we have going forward. That really is the cornerstone of our discussion today, and we wanna share that with you and why we believe in it, why you should believe in it, why should our investor look forward to, you know, very good returns. Of course, in terms of returns for our shareholders, we've done quite well based on these successes we've had over the last 5+ years. Okay. What is our future state? I call this our future state is what are we looking forward to? Fundamentally, the core strategy of our company is that when it comes to intelligent, multi-domain robotic systems, we want to be and we are, and we're gonna continue to be the go-to company on the face of this planet when it comes to defense and commercial applications. Intelligent multi-domain robotic systems for defense and commercial markets. These words are very specifically chosen. I expressed that to our employees, to our shareholders, to our customers, you know, repeatedly. Intelligent means really that it's all wrapped with autonomy, AI, machine learning and artificial intelligence. The things that takes a lot of the cognitive load away from the burden from the soldier or operator or user itself. It also allows them to actually interact and interoperate with each other. Okay? Multi-domain. We are already at least in two domains. You can argue that we're in three to four domains. You know, we flew in the atmosphere of Mars. That's technically a domain space. We're in, you know, air robotics, ground robotics, and you could claim that Blackwing, which is part of Switchblade's family system, is an underwater UAV that gets launched from water, underneath the water and then comes out and then it starts to fly above it. But we're not gonna stop there. Our portfolio is the broadest and deepest portfolio of solutions when it comes to that capability anywhere on the face of this planet. I challenge anyone to come up with another pure-play company that has this deep and broad portfolio of solutions that's around that particular theme. This is not because that's what we wanna do, it's that's what our customers wanna do. If you talk to the U.S. Army, to our 50+ allies around the world, to Air Force, to Navy, Marines, they want these systems to be integrated. Their strategy of their capability gaps and future warfighting force structure requires and demands these types of solutions. What we wanna do is to be the company to continue to deliver that to them as we go forward. That's really at the core of our strategy. Okay. The other thing I wanted to mention is, let's see if I can stand somewhere that I could do this easier. Our portfolio, you know, I mentioned about our portfolio. Look at what we offer just on a fixed-wing UAV, small UAS, what you see from our Wasp AE, Raven, Puma AE, and Puma LE. We have our unmanned helicopter solutions that you're gonna see some of those demos today later, this afternoon, right after lunch. I believe is the time. Quantix Recon, then we have ground robot solutions. We did an acquisition with Arcturus, which is now our medium UAS, which is a group two and three UAV that's expanding. Solar Stratospheric HAPS has as an application for both commercial and defense. All the other supporting gear that goes along with it, which is a digital data link, ground control station, our ground robots, of course, don't wanna forget about our Switchblade family of systems, a growing family. If you looked at this portfolio six years ago, I would say it was significantly less offering than what it is. More than triple probably in the depth and breadth of the product line. That's one thing. The product lines that we have now, it's actually six distinct product lines that I mentioned. Small UAS, medium UAS, tactical missile systems, HAPS, MacCready Works, which is basically. I'm gonna talk about that in a second. Unmanned ground vehicles, UGV business. Those six product lines comprise all of our business as an enterprise. The MacCready Works is where majority of our organic businesses were born from. Small UAS was given birth, I call it, and our MacCready Works innovation, CRAD, consider it, you know, the very, very futuristic programs and projects that we do there. The current Mars helicopter, Ingenuity, was conceived, proposed, you know, NASA had to be convinced and then developed and made into a capability that everybody around the world knows about it. Switchblade and our tactical missile systems came from the same area. Our ground control stations came from the same area. It is the place where we do innovations that are far beyond one year, two year, three years out. We have several exciting portfolio of projects, activities with the customer in terms of programs and innovations that is happening within our MacCready Works is extremely exciting. Many of which I'm not able to talk about primarily because of the sensitivity of our customers to those projects. Okay. I hope that I'm gonna do okay in time because Jonah has given me a challenge here, so I can say, "Okay, great." The next thing I wanna mention to you is about our evolution in terms of inorganic. You know, historically, AeroVironment has been a very, very organic focus-centric company for the last almost 40 years of our existence. Last six years has been actually quite a dramatic difference. I don't say that we're just gonna grow based on acquisitions. That's not our strategy. If you look at our portfolio and look at our business strategy, it's very easy to see that as our portfolio grows and our mission sets for our customers becomes more and more demanding in terms of requirements and missions they wanna do, we have to make sure that we fill those gaps in terms of either capability coverage in the customer base, distribution, or products. You know, if it's in the last five years, we've actually done five acquisitions, small and some somewhat large relative to our size. You know, the first one was the VAPOR product line, which is part of our small UAS business, Trace's business. In AI machine learning, you're gonna see an example of that in the demo today, where we have taken our in-house capabilities coupled with this acquisition of Progeny Systems that now makes up, which is part of our MacCready Works, that's focused on delivering these capabilities to all of our product lines across the entire portfolio. You'll see an example of it today in a demo, I believe, today. Very, very exciting. The things that we're doing is, this is actually a capability we're gonna be delivering now. It's not something that we're promising for two years or three years from now. It's the capability that we're delivering now that allow our UAVs to fly in GPS-denied, comms-denied environments. Very, very contested environments. A lot of the success you see about our products in the field is because of these capabilities that are already built into our products. We acquired Arcturus, which is now our medium UAS that Gorik runs the facility we're in now, which really gave us access to a much bigger market. And then, of course, the ground robots, and then the last one was Planck Aerosystems, which was literally a few weeks old, or maybe a month or so old. It now also is part of our medium UAS. It gives us some specific capabilities that Gorik's gonna talk more about it. Our evolution or transformation is gonna continue. We believe in the next three to five years, there will be many opportunities for these gap-filling capabilities and opportunities for us to act on and do that. We're not waking up every day that this is all what we're gonna do, but as those opportunities present themselves, and they make sense, and actually accelerates our execution of our strategy to get to our future state faster than organic, we will absolutely consider that. It'll be part of our strategy. Okay. Long-term objectives, this is a question that I'm always asked. You know, there's a saying that we have that the rate of disruptive adoption is very, very hard. The timing of disruptive adoption innovation is really hard to predict exactly when it's gonna happen. You see the examples of that in every industry. We were talking to Ken last night about other companies that are in a similar situation, right? In general, we believe now with a diversified portfolio of businesses, customers, geographies, and markets that we are in, we have been a growth company, and we will continue to be a growth company. Our expectation is to grow at the rate that we've been growing in the past or even better, okay? Even though we're much larger relative to five years ago. We will continue to invest in R&D as we have done in the past because we believe that our growth and our customer needs require our business model requires that. We invest quite strongly, I call it, not heavily, very judiciously. The reason why we do that is because it allows us to develop the capabilities our customers are expecting from us, and we expect that to continue. We believe that the size of our team and our areas of expertise will continue to grow, you know. That is absolutely in our strategy and our focus. There are many new areas that I'm gonna talk about in the next couple slides that we believe we're extremely well positioned to be the go-to company to help our customers with the capabilities they're looking for in the future. Not only just next year or the year after, but the next 5+ years. We're positioned extremely well. Think about if you were the U.S. military or allies. The future is all about unmanned systems and interoperability. You all know this from many, many, many industry trades and presentations and strategy documents that are out there that it's all about how you. The conflicts that are going on today, that how important is the interoperability of these systems together and do things much more seamlessly. One thing I'm gonna mention is resiliency. We have been proud of this for many decades, even though during the COIN conflicts in the Middle East or Afghanistan or other places in the last decade plus, that what our customers really care about is that our system's gonna work when they need them to work, when they want them to work, to do the functions they have to do. Today, I would say that the conflict in Ukraine has proven to the world that if your system is not resilient and proven to work in contested airspace against a peer or near-peer adversary, you're not relevant. You're not relevant. It's become table stakes. We strongly believe that we have a significant advantage here, and we're gonna continue to build on that advantage as we go forward. There are many things we wanna do that we don't do today that is in our roadmap that is all around resiliency of our solutions in contested airspace or battle space or ground space. Doesn't matter. Our investment in AI and autonomy is one of the core cornerstone of that strategy. You know, the investments that we've made 5+ years ago in this area is starting to, you know, provide what I call dividend or yield results for us now. A couple of the demos you're gonna see today in our UAVs is specifically around this construct or this theme. Brett Hush and Trace is gonna talk about some of this today as part of their product capability as well as to where we're going with that. Our product line will continue. Our workforce will continue, of course, grow. Our business processes of easy to do business. One of the things, as you know, that I've always talked about is we are not the biggest company. We don't have the largest lobbying, you know, force. We're agile, we're innovative, and we're very, very close to our customers. Those are the three things that we really, really focus on as part of our core competitive advantages. Innovation is based on our R&D and our product portfolio, disruptive innovation. Agility is by far the most important thing. We've had systems that we've had in the field, and if we had run into some kind of a resiliency issues, within a matter of weeks in the last six to nine months, we've been able to develop a key solution, roll out a software upgrade, take it to the field, into the battle space, and update our products. That level of agility and flexibility with our, for our customers and speed is incredibly important and what's what a lot of customers know AeroVironment for. Okay? Of course, we wanna be a great place to work. It's fundamentally this is our third consecutive year in a row, I believe, that we have won the Great Place To Work accolade as part of an organization. Fourth, I think third or fourth years in a row. We're on our fourth year. We just got the fourth year consecutive one, and it's one of the it's an organization that essentially do their own surveys. They go talk to our customers that are anonymous. We've been now four years in a row. People who come to work at AeroVironment, and I mention that 'cause I'm very focused on that, and I'm proud of that, is that this is not just a place to clock in and clock out and get a paycheck. Most of the people we have, they have a passion. They have a direct connection with our capabilities and what it does for our customers. Many what I call personal connections with what we do for the war fighter or for our customers because of either their background or their experiences or their family or their personal desires and passions. Last but not least, if we do all that right, I am certainly confident that we will take care of our shareholders, and we'll have oversized returns as we've had in the past for our shareholders. That's really part of our strategy. Okay. Why do we believe in that type of a strategy and future state and outcomes for us? The reason is because a lot of the outside forces are in our favor. They are really aligned with our strategy and where we're going. The war in Ukraine has woken the world up to the construct of small, not even medium or large, at least small and medium UAVs and loitering munitions, and how these things together can do things for us, can do for our customers. Even in a near peer-to-peer conflict, the videos, the messages, the stories that you guys see of what Ukraine is doing against the Russian forces all over their, you know, fronts, just an incredible example of the Pentagon waking up, Congress waking up, 50+ of our allies waking up and realizing this is a must-have. This is not a nice to have or a niche thing. It's fundamental to one of the most important markets that we serve, the defense industry. The war has also actually validated the efficacy of these systems, that how you use them could make a huge difference. You know, we're technically fighting a proxy war as a nation, without any of our own boots on the ground. We're extremely successful helping Ukraine make progress. You know this better than I do. It's primarily because of the capabilities that we've provided them, and majority of that capability is around the systems that I'm talking about, and plus some more of course, you know, things such as Javelin and other capabilities too. From a policy standpoint, I think not only the U.S. government or not only just DoD, but Congress and the administration has realized we need to upgrade and invest in our defense, infrastructure, call it, and capabilities. Systems that need to be replaced, systems that need to be upgraded, systems that need to go to the next level. Pretty much all of our allies in Europe, and then some, have a similar sentiment. Everybody's either raised their defense spending or going to, or doubling and tripling in some cases, right? Despite the macroeconomic forces of higher inflation and potentially a recession, we believe this is one area that I don't see how it could be very negatively impacted because of all these other positive forces and trends that are going on. Now, when there's a recession, everything gets affected to some extent. I believe that we're very fortunate based on where we are and what is going on in our markets, that we're in a much, much better position than majority of other companies that are in the space or in any industry, in my view. Okay? That's actually a very, very good sort of a position to be in in a situation that we could execute our strategy. I don't think that investments in autonomous systems, unmanned ground robots, unmanned UAVs, sub sea systems, autonomous systems, loitering missiles is gonna take a hit anytime soon. It's gonna be a market that is gonna attract more competitors, more investments, and more opportunity for growth. We're very, very fortunate to be in a position we're in to sort of leverage that and help grow our business and help our customers. We're very well-positioned, and we're gonna continue to invest, and we expect to continue to grow at those double-digit, you know, figures that we have been in the past several years. Okay. Last slide. Future for us has never been brighter. I've been here for 12 years. Honestly, we've had some really, really great years. Outstanding journey so far, but I do believe that we're extremely positioned well, and I don't think that, and I've said this many times to our employees and our customers too, that the future prospects for growth, and value creation for us has been better than what it is in the 12 years in the company. It's, you know. We have a very clear plan for growth in supporting our global presence and our global customer base. We really do. Every one of our businesses, you're gonna hear from some of them, and you can ask questions on that, and I encourage you to do so, to the level that we can answer them and give you those non-sensitive parts of the story we will help you with. We are the leader in the markets we're in, and then our transformation is gonna continue. I expect us to continue to go down this journey. Our team is excited about it, and I do believe that we have the right team and the right capabilities to keep building upon the future. The last thing is that we're gonna do that based on staying close to our customers, investing in innovation, and then being extremely agile and fast to changing direction or adjusting to our customers' needs. Those are the three things that really matter to us the most. With that, I'm gonna hand it back over to Jonah. Great. Thank you, Wahid. You're welcome. I will say you are five minutes early, so great job. All right. Well, with that, it's now my pleasure to introduce Kevin McDonnell, our Chief Financial Officer, who's going to put some numbers to the trends shaping our business that Wahid just discussed. Don't get them too excited. Take it away. Good morning. You know, Wahid laid out a bit of the vision, a little bit of where we've been. I'm gonna just try to put some financial context around that for everybody. The first slide here shows you our six business segments, which you're all very familiar with, but we tried to look at it from the standpoint of what are the size of the markets we're looking at and kind of where do we stand in those markets. The top one is our core bread and butter for the last decade plus that Wahid talked about is the small UAS business. That's about a billion-dollar market. I'd say it's somewhat mature, but we are the dominant global leader in that market, and we're gonna continue to grow in that market because we're gonna be able to upgrade that install base of over $2 billion of equipment over the last 10 years and come up with innovative new solutions and things that people can add on to those current products. We very much see it as a growth business, a little bit more mature market. The medium UAS market is a mature large market. It's at least double, we think, of the small UAS market. We're the disruptor. We're the new kid on the block. We're bringing our innovation and technology to that segment. We've made some great inroads with winning the increment one of FTUAS. You'll hear more about that later from Gorik. We see this as a great opportunity for us to penetrate what is already a very, very large market. The TMS segment, which we basically were the originators of that. Brett in the back of the room, he'll talk about that later. We see this as a tremendously large market. It's a growing market. It's a changing market. It's taking a share away from other solutions for loitering munitions, but we see this growing very fast. We're both kind of a disruptor also in that market because we're trying to bring our solutions to the battlefield, and we see there's tremendous growth potential there for the TMS market. The HAPS market is really a longer-term play, very big. It's really based on our joint venture or a relationship with SoftBank in developing a telecom solution, but we're also working on some DoD solutions which may actually bear fruit sooner. UGV was an acquired business, not a very large market. We're making good inroads there, capitalizing on our U.S. presence. Then MacCready Works, which we don't talk about a lot because there's a lot of things they do we can't talk about, but we're very excited about the fact that there's large growth potential in the classified business segment, and we're making, we're seeing some good innovation there, and it's really a place we might see some new products in the near term coming out of there as the battlefield evolves to different regions. The main part of the story, the real story is, you know, if we look back to where we were in Investor Day four years ago to today, our TAM, our available market has grown tremendously, what we're addressing. What are the long-term growth drivers? You know, first and foremost is just with, as Wahid laid out, some of the conflict in Ukraine and the recognition around the world of threat is increasing global defense budgets. We all know about that. Second is obviously the increased demand for loitering munitions. Again, that market is growing fast, and we're gonna capture our, you know, our more than our fair share of that. Third is, and I'll show you in a second, there's a lot of large billion-dollar-plus programs that are on the horizon. I don't think AV has seen that many coming at them at once, and we really feel good about our position in most of those programs. Fourth is the international demand for our TMS and MUAS products. TMS has obviously been a domestic type of product. We've announced that we can now sell to 20 countries. MUAS, we're gonna take our global footprint and sell that product internationally. Traditionally, it's been more of a SOCOM COCO business, and we're gonna try to make it more of a aircraft business globally. Fifth is, as we mentioned earlier, the upgrades and replacements for the small UAS business. Six is the growth of classified programs from our MacCready Works business. Seventh will be the long-term commercialization of HAPS for telecom and DoD applications. This chart just summarizes some of the larger billion-dollar programs we see on the horizon. You see there's a number of them. You see there's a number of them in the TMS segment, so again, that's one reason we see we're very bullish on the TMS segment. We also obviously have the MUAS segment where we have the future tactical the FTUAS program, and small UAS has the next generation DoD bids coming out in the next couple years. Financially, what does that mean? We're not gonna put out guidance, but I think we can put it in some context in terms of where we've been. You know, over the last five years, we've had 14% revenue growth. We've maintained fairly high R&D investment at 12% and achieved an average of 17% adjusted EBITDA. That's pretty much in line with where our guidance is for this year, and, you know, I think that's a very strong track record, and as Wahid alluded to, we want to even do better the next five years. We do think on the revenue side, there's so much growth potential for us, with all the large programs, the growth of the TMS products. It can really move the needle for us. We will continue to maintain a high level of R&D investment, and we'll focus on that and, you know, hopefully achieve around the same EBITDA levels, but that won't be our primary focus. The primary focus will be to capture these markets. We've got tremendous opportunity, and we need to make sure we're well positioned for that, and that's our primary focus over the next long term, five years or so. We expect continued double-digit organic growth, R&D investment and adjusted EBITDA to be kind of in line with where we've been. With that, I'm turning it back to Jonah, and I'm probably way ahead now. That might be a record. Thank you, Kevin. All right. Well, keeping us on track, it's my pleasure to introduce Gorik Hossepian, who will talk about the medium UAS business and specifically the future tactical UAS opportunity that's in front of us and some of the enabling technologies, including the Planck acquisition, which we completed about a month ago. Gorik, this is his 40th year in the aerospace and defense industry, and I can't believe he allowed me to say that. He managed Litton's Guidance and Control division for Northrop Grumman. He was a director of commercial satellite programs for Boeing. He led a P&L division of Honeywell in Los Angeles. He has worked on every major military and commercial transport airplane in service today, as I think Wahid alluded to earlier. He's testified in front of select congressional committees on matters of personnel nominations and clean energy technologies. A point of pride for him is that he was the program manager for Honeywell's space station efforts and has over 1,000 pieces of hardware on the International Space Station. Lastly, he's an engineer f rom USC. With all that said, now that he's sufficiently hyped up, Gorik Hossepian. Thanks, Jonah. Good morning, everybody. Excuse my voice. I'm not contagious. I just have a cold that I have a tough time recovering from. Welcome to Petaluma. As you might guess, I'm particularly proud to have you guys all here. This is a facility we all take a lot of pride in. Just a couple of numbers before I get started. We have approximately a little more than 145,000 sq ft of facility here in Petaluma. There are actually three buildings. The building you are in, the building across the street you will see later on today. We'll tour you through that facility and show you how we actually manufacture our products and what the hardware actually looks like. We have about 2 or 3 mi north up the road from here, a dedicated facility for the manufacturing of our engines for all of our aircraft. Altogether, we have about three different buildings, roughly 145,000 sq ft. We employ a little more than 250 employees. Half of them are on site here. Approximately half of them are field service representatives that live in different parts of the country, by the nature of the work they do. We deploy on rotations to various sites, operating aircraft and providing services, mostly for the U.S. Special Operations Command. Again, we're very proud that we had the lion's share of the business, for the ISR contract for good old SOCOM. With that said, I'm gonna start the presentation by just first showing you a quick video, get everybody hyped up a little bit about this business. I'll talk a little bit more about what we do here, but I'm gonna focus the rest of the presentation on a couple of subjects, one being the latest acquisition of Planck, but more importantly, I'm gonna talk a little bit to you guys about The future of this business, where we think we're going to go, and the excitement we feel about being selected for the FTUAS program, and I'll brief that and explain what that is. Let's see if I can get this right. Hold on a second. Okay. Before I dive into the FTUAS program in particular, we build fundamentally a Group Two, a Group Three aircraft. That might not mean a lot to everybody, but it's shorthand for larger airplanes that you can't hand launch, airplanes that require something other than a human being to launch. This business has been, or this area has been one of significant interest for AV to get into. I'd like to tell you that I was hired to do that job, figure out a way for AV to get into that piece of the business, and we've looked at a number of options to do that, including organic growth and organic development of the product. Ultimately, at the end of the day, the acquisition of Arcturus was the right decision for us and allowed us access, immediate access to this marketplace with a really unique product. When you see the airplane, you'll recognize it's probably something you've never seen before when you see the actual hardware. It'll give you a good feel for the scale. We'd like to think that what we do in this company is really be a disruptor in this field and hardware of choice. If you ask anybody here what is it you wanna accomplish in this company, we will tell you that within this product line, we wanna be the best truck you can ever buy. We take a particular point of pride in designing a product and delivering a product that serves that purpose. Our customers do not have to suffer from anything like the rest of our customers do from the problem of vendor lock. Our product is so versatile that to this day we have integrated over 62 different payloads on this aircraft, and that's unheard of in this business. Absolutely unheard of. With that said, and the reason I explain that to you, with that said, I wanna talk a little bit about how we believe that has impacted us in our ability to win FTUAS. FTUAS stands for Future Tactical UAS program. It is meant to replace the Shadow fleets within the brigade combat teams, and last count, there's a little more than 60 of them, around 66 to be exact. It's a major program of record. It's one that lots and lots of companies have eyed. We are probably the only outfit out there that has won this competition three different times, and we have to win it a fourth time. We won the original award for FTUAS back in 2018. We were the only company that got awarded two task orders as a result of that. We were subsequently the second task order actually was delivering hardware to the 82nd Airborne Division. We were then invited to what was known as the rodeo, along with all the other competitors, and we were clearly the hands-down winner. We were the only one who took a fleet of aircraft to the rodeo and brought the fleet back. Everybody else crashed their airplanes. We actually flew in extremely poor weather when everybody else grounded themselves. Clearly the winner of the FTUAS rodeo. We then subsequently responded to an increment one RFP, and once again, single source award, we are the winner of that award. We just announced that about a month ago. We took a press release out about that about a month ago. I wanna tell you that when by the time we've issued the press release and we announced the award, we were crating up the hardware and delivering the hardware to the U.S. Army. We were so confident about our ability to win that job, we built the hardware ahead of time and have delivered the hardware. I have a group of people here today at Huntsville trying to start the support and service business. It's a major program of record for us. We're very much excited about being on it, and I'm gonna explain to you a little bit about what that program entails. What does the program entail? The actual replacement has a three-phase approach. Increment One is the announcement we just made. Potentially Increment One has a value a little north of $60 million because you could go as many as eight brigade combat teams. We've been awarded a single source for a system of six aircraft and four ground control systems. As I mentioned, all of that has been delivered, and they will start undergoing testing and evaluation for about a nine-month period, planned nine-month period with the U.S. Army, and that's fundamentally designed to help refine the requirements for what is known as Increment two. The plan is to get Increment one aircraft in the hands of up to seven brigade combat teams. We're obviously prepared to support that and build the hardware for them. You will see fundamentally the aircraft that have been delivered to the Army. That will be followed by an Increment Two. We expect Increment two to start soon, sometime in the next six to nine months. In Increment Two, the government will take a phased approach. They will bring along a number of vendors and use a gated process. One of them would be an evaluation of manufacturing capabilities. The next one would be a design review from the point of view of a preliminary design review, and then critical design review. Then deliveries of prototype systems for the government to fly and compare with each other. Increment Two will end in a prototype system delivery and evaluation by the government, and then that will be followed by what we call a final award. The government, based on that evaluation, will select who will be the recipient of the actual program of record for FTUAS. That is a major activity for us. It's a major get for us, and it's a major program for us. That program represents over $1 billion worth of revenue, not just in hardware deliveries, but also in support, and spares and services for the government. It has a very, very long tail. If you take a look at Shadow as it is today, for its current provider, that's been a program of record for well over a dozen years, and it's been a franchise program. It's what they call a franchise program. For us, this is our ability to go after a real franchise program. As I mentioned, we have already won this competition three different times, and we are confident we're gonna win it the fourth time and be the program of record. Now, from a competitive advantage point of view, one of the things that most people don't know about is, Our customers do, but most general public do not know about, is we fly this airplane every day today in five different sites in a GPS-denied environment. Our aircraft, weather permitting, fly 30 hours a day at every site in a complete jammed environment. We take off, we execute the mission, we come back and land in a totally jammed environment. That is a capability that's unheard of and very, very hard to replicate by our competitors. Our aircraft manages to survive north of 14 hours carrying about 30 lbs of payload with a range, we advertise a range of 185 km, but as recently as a few weeks ago, we flew the airplane as far as 200 km out, and we could have gone further. We just decided to bring the airplane back. We sit at a very interesting sweet spot between our ability to carry payload and endurance. One of you asked me last night, and I'm sorry if I can't remember that, about what was unique about the product and I said that we need to figure out a way to operate at a sweet spot between a number of capabilities, range, endurance, the ability to carry payload. We find ourselves in that sweet spot. There are aircraft that fly further than ours. There are aircraft that can stay afloat longer than ours, and there are aircraft that can carry more payload than ours. There's no such aircraft that can meet that combination of 14 hours, 30 lbs and the range of 185 km in the business. That beast does not exist except within the walls of this company. Again, last month we rolled over 115,000 hours in combat operations with these airplanes. As I mentioned, every site, weather permitting, flies 30 hours a day, so we rack up quite a number of hours on a daily basis. I think that count is now a little more than 120,000 hours, but triple digits, six digits in the number of hours in actual combat environments. Now, just to enhance that capability and our competitive position, as Wahid mentioned, we engaged in the procurement of a company called Planck Aerosystems in San Diego. We mentioned all the facilities we had. Wahid forgot to mention San Diego in the long list. Now we have a facility in San Diego. I'll brief you a little bit about the uniqueness of Planck, but with the acquisition of Planck, we acquired a very unique technology that we were already integrating in our products here for visual takeoff and landing of the aircraft in a complete denied environment, meaning our airplane no longer needs a GPS signal to acquire where it's going, where it's gonna land on, and whether it's gonna take off or not. The autopilot can operate that aircraft completely devoid of GPS during takeoff and landing, and that's a major capability. The enemy's ability to damage the airplane on takeoff and landing is the real issue that we have to solve. They bring to the table, in addition to that technology, some very unique autonomy capability that I will talk to you about. All right. Specifically what did Planck bring to the table? They brought to the table a product, they brought to the table a technology, and they brought to the table a capability. The technology being the technology that we call OpTrack. It's the ability to actually visually identify and track targets. It's being used to even identify swimmers in the middle of the ocean. As you might guess, in the environment we operate and fight the fight these days, that's a capability that is highly in demand, being able to track, identify and track an object in a cluttered environment. The technology they brought to the table for us, as I mentioned to you, is the ability to visually take off and land, and what makes this particularly attractive to us is that this visual cueing of the system allows us to actually operate this aircraft from the pitching deck of a ship. It no longer needs a stable base for us to come and land. The system can identify if the landing zone is actually moving relative to the airplane, and that's what enables us to be able to go land on a pitching deck of a ship. It also filled for us a gap in our small UAS portfolio. The product that is fundamentally a tethered product that can be used for a variety of reasons, everything from communication nodes to actually a visual sentry, and it can stay up in the air as long as you have power supply to it through a tether. A real complete fit for this organization and in addition to providing key discriminators for our position on the FTUAS program. Just to show you what I mean by that technology, we're gonna see a video, an actual video of a quadrotor using that visual cueing technology coming and landing on a ship. This is right off the coast of San Diego. As you might guess, we have a relatively simple time testing this equipment in San Diego. Bear with us with the. It's acquired that visual cue on a deck of a boat. You will see that it will come closer and closer to it, and at the end of the video you will see the actual touchdown. There you go. You saw how much that boat operated and moved in the ocean. The system was able to compensate for it upon landing. Okay. Now, this autonomy engine that allows us to land really makes this product ready for a maritime solution. We can't talk a lot about all the other things we're doing to marinize this airplane, but the ability to take off and land on a pitching deck is arguably the enabling requirement for being able to operate in maritime. What that means is, we now believe we have a product that has far greater potential applications than terrestrial applications and the ISR applications. We can, you know, operate on a ship, from a ship-to-shore based missions or a ship-to-ship based missions. We can integrate this within all U.S. Navy and NATO decks, and as I mentioned, we can do automated surveillance and reconnaissance with our OpTrack. New autonomy capability that brings more than just there is an object there, but who that object is, what that object is, and track it as a function of time. Now, when you see this airplane today, I'd like you to sort of. I'm gonna show you a version of the airplane that is not yet shown a lot in public, but this is a very capable platform. It's a platform that can carry 30 lbs of payload, and it's agnostic to what that payload does. It doesn't matter what I wanna carry. If I wanna put a camera on it, I'll put a camera on it. If you want me to carry a missile, we'll carry a missile. If you would like us to carry an EW payload, we carry an EW payload. A typical mission we fly today is a combination of an ISR gimbal and an EW payload for U.S. SOCOM. An application that is evolving very quickly for this product due to its capability, that sweet spot capability to be payload agnostic, is armed applications, and you will see a version of that today. We have to date fired a Switchblade off of this aircraft. I'll show you a video of it. We just completed a design for a version of the airplane that can carry a Switchblade 600 mounted onto the belly, and as recently as about two months ago, we fired Hatchets. Hatchets are laser guided bombs built by Northrop Grumman. We installed two in the belly of this airplane inside the fuselage and tested it for the U.S. Navy. The vehicle has proven its versatility for being able to come up in an armed solution. You can imagine how valuable that capability is today, especially in light of what's happening in Ukraine and what we expect to happen in the coming years, unfortunately, in other theaters of interest, especially in the South China Sea. As a parting shot, I will show you a video. This exists on our webpage, so if you do a little bit of a search you can see it. That's the 300 under the wing. You saw that capability. That's a valuable capability to a lot of our nation allies, and we will continue to develop that capability in a very short period of time. Thank you very much. With that, I'm gonna pass it on to Jonah. Yes, I am old. Jonah was right. Thank you, Gorik. Thank you. Appreciate it. All right. We've arrived at our first break. We're going to take about a 15-minute break. Let's meet back in this room at 9:55, so 15 minutes from now, and then we will take a facility tour with Gorik hosting now that you've had the background on the business and the product line. There are, as I said before, restrooms around the corner. There's also a coffee and tea station. There's drinks and snacks over there, so please feel free to help yourself. Just note on the tour, you have to leave all your computers, iPads, phones, everything in this room. It'll be safe and secure here. There's no pictures or videos allowed on the tour. With that, let's take a break. Thank you. All right, everybody. Welcome back. It's my pleasure now to introduce Trace Stevenson, our Vice President and General Manager of our small unmanned aircraft systems business. Trace has been with AV about 18 years, so he's almost halfway to catching Gorik. During his time at AV, he's really seen the company mature into the business it is today, and he's led a lot of that growth himself. Prior to leading the small UAS business, he was a deputy general manager for UAS. He also had responsibility for overseeing our strategic partnerships, including the HAPSMobile relationship, and so he got very good at negotiating. He also oversaw our integrations of our acquisitions. Before then, he's basically done just about everything there is to do within the company. He's very seasoned, very experienced, understands the company very well, understands the business very well, and he's gonna take you through some of the innovations coming in his product line to match the upcoming expectations of our customers. With that, I turn it over to Trace. Thanks, Jonah. Good morning, everyone. Thanks for the opportunity to talk about the small unmanned aircraft systems portion of our business. I'm very excited and honored to lead that business for AeroVironment. It's been the core of who we are today, and I hope it remains the core of who we are going forward. I know Brett and Gorik are trying their best to overtake me and have the largest business in the company, but game on. Until then, I'm gonna continue to be proud and as being the largest segment in the business and really talk to you about my strategy going forward and how we continue to be the, you know, the leader in this space, in the Group One space, and pivoting towards Group Two as well. I have an evolving portfolio within SUAS. You know, we've got our legacy systems, Puma, Raven, Wasp, that you're all familiar with, and really that has positioned us as the leader in this space. Really the reasons why we've been able to lead this space and maintain that leadership is because we really focus on reliability and rugged ability on the onset, making sure that our systems survive in the fight, in the actual battlefield. A common user interface. We talk a lot about a family of systems and interoperability, and having all these systems on a common user interface so that our allies and our customers can switch from one platform to another and really not need any additional training. Providing different capabilities with that common interface and interoperability has been key for us in getting adoption into new platforms going forward. Hand launch, you know, we created that. Very easy to launch and recover the aircraft. Best-in-class Group One payloads. At the onset, there was nobody out in the market who could do payloads like we could, that could design Group One payloads in the swap, size, weight, and power constraints that we have for our system. We had to design them ourselves, and we continue to really focus in that area and bring new technology forward with it, and I'll talk a little bit about that. A common radio, a digital data link radio. Again, we designed our own data link, not because it was a market we chose to go after, but because we had to, because there was nothing else in the space at the time that we needed it. I have to focus on really keeping those systems relevant for our 55+ countries that we're in, updating that technology and those legacy systems so that they continue to be relevant in the peer versus peer fight. I'll talk a little bit about some of the new upgrades and capabilities that we recently released and how they apply to that current fight. At the same time, in parallel, develop our future family of electric hybrid VTOL systems. Really, that is to focus on everything we've done in our legacy systems, but then expand in the Group Two space and really bring all the technologies across the company that we've been working on for several years and package them into a next generation type of class of vehicles. Wahid mentioned GPS-denied, autonomy, new payload technology. Taking all those things and putting it in our next generation systems has to be VTOL. Our customers are requiring it. They're demanding it. I'll talk a little bit later on why. It needs to be modular. We need to be able to incorporate all different types of payloads, all different types of radios. We need to be able to provide a platform that can integrate into the battlefield with other systems that our customers are utilizing, so they can all work together, talk together, and perform missions together. What does this mean from a future product philosophy? I talked about next generation hybrid electric VTOL. Really we wanna still remain best in class from an EO/IR capability, capitalizing on what we've done in the past. On our payloads, you'll see a next generation payload that we're developing for Raven out today on the site. You'll see it side by side with the legacy or old generation payload and be able to see really the improved performance and capabilities that we're gonna provide for that product. You can envision us taking all that video chain, all those capabilities, and embedding it in our next generation systems. Gorik mentioned that endurance is always key. Endurance, range, and payload capacity is always key, right? As Gorik said for his class of vehicles, optimizing that, I have to do the same for the smaller class of vehicles. Wahid mentioned being able to operate in contested environments. You know, the fight that's going on today, there's comms jamming, there's GPS jamming. Being able to perform missions in that type of environment is critical. Wahid mentioned it's today, it's now, and it's table stakes, so we have to keep that front and center. As I mentioned, VTOL, it's a must now. Customers are demanding it and requiring it. I'll talk about a little bit what we're doing on Puma to add that capability, but you can envision all our next generation systems will have VTOL capability. Wahid mentioned autonomy. Big thrust and investment in autonomy. We've been hardware focused, you know, in the past years, but still remain hardware focused on next generation systems. We have to become technology focused as well and be able to have the capability to embed autonomy features as they get developed with an industry or inside of our environment. Having a core, a modular core in the system to be able to upgrade or add autonomous features to the system as they become available is critical for the future of SUAS. As I mentioned, payload agnostic, radio agnostic, modularity, being able to incorporate anything that a customer wants to incorporate into this truck or these systems. Multi-payload capability. When we talk about autonomy, I'll talk about autonomy coming up, but, you know, using multiple payloads at the same time to perform missions. Very portable, in the small space, so the soldier has to be able to pack it out, they need to be able to get it to where they need to get it easily. Scalable architecture, so we can scale up or scale down. You can envision lower cost commercial solutions or larger systems. Having an architecture that we can easily scale that allows us, as Wahid mentioned before, to be agile and to provide new systems and capabilities quickly to the customers without having to redesign the whole entire system is really key going forward. I, as I previously mentioned, being able to expand autonomy over time and not have to redesign or the systems, but have them capable of incorporating new autonomy features as they become available. Why VTOL? Why are the customers asking for it? They're tired of launching. They're tired of hand launching. There's pluses and minuses, and you've seen the videos of our systems crashing on the ground and breaking apart. They're designed that way. They're rugged, but you can still get damaged that way. Really not having to hand launch, being able to vertical take off and vertical land in tight spaces. If you're in between a building, the hand launch does not work. The customers are just demanding everything has to be VTOL going forward. We've gotten the message and we're working on them. We still need to maintain all-weather capability so that it can operate in the extreme conditions that our systems have in the past. On the autonomy side, what's the focus that I would say the near-term focus and long-term focus in autonomy as Wahid mentioned, is reduce the cognitive load on the soldier. The system needs to perform missions for the soldier autonomously versus a guy six hours, three hours, depending upon the platform, looking at video all the time. We need the systems to go out, find the targets, notify the operators when they find the target so that the operator can act on that versus the operator having to stare at a video screen for three to six hours at a time. Pre-planned mission execution without comms, execution without GPS, target tracking and responses to emergencies. We talked about the acquisition that we did in AI and machine learning with our location in Manassas, Virginia. Taking that technology that they're developing and being able to incorporate it in all our systems across the product portfolios is really key and strategically why we acquired that company. Health monitoring, so the aircraft is smart enough to detect when it has a problem, notify the operator, allow the operator to make a decision, and save the aircraft, is a focus going forward. Really making it easy for our soldiers to perform their missions. As we evolve over time and continue to invest in this, you know, you can see long-term swarming, you know, systems working together with each other, sensor fusion, so multi-payloads on the same aircraft talking with each other, being able to make informed decisions based on the capabilities that they're bringing forward. Lots of investment, from my perspective, going into this area, going forward. Next, I'll talk about a couple of the latest two or three releases that we've done, and in the existing systems. I've got a video here on our next generation VAPOR. It's called VAPOR 55 MX. You'll see in that video kind of what I talked about, modularity, being able to plug and play different radios, being able to plug and play different payloads. When we bought Pulse back in 2019, really we filled a gap in having an unmanned helicopter system, and we found a company who really had optimized performance in electric-type helicopter. What we've done since then is invested in the next generation to really incorporate what AV understands that the customers need. We're really excited about taking this to market now. Lots of excitement in the customer community about this capability and it's just it's been a long time coming. You know, lots of missions for this capability. It's a truck, it's all electric, but over an hour of endurance with up to 12 lbs of payload, multiple types of payloads at the same time. Typical missions, as you saw in the video, expeditionary scout, delivering different payloads, mapping inspection for the commercial applications, a maritime patrol, and small munition firing. Gorik showed a video of JUMP 20 firing a Switchblade 300 off of it. We've also fired Switch blade 300s off of the VAPOR 55 as well. Other product that's close to release at the late stages of development is what we call Puma VTOL. It's an upgrade kit that you can add to any existing Puma system that you have out in the fleet. The engineering team has done a slick design there that basically you have these two booms, the yellow booms in the screen, that basically insert between the left tip and the right wing tip, and now you can do a VTOL mission. Really, again, focused on a modular upgrade kit to give the customers what they've asked for, which is a VTOL capability. Comes in one case, and they can now perform a VTOL mission if they want, or they can perform the hand launch mission as well. There's an endurance hit because the drag that's added by adding the booms, so you get about 1.5-hour endurance versus the 2.5-hour endurance on the Puma 3. You have the flexibility to choose between whichever mission you wanna perform at the time with just a simple upgrade kit. Lots of interest in this capability. We've been demonstrating it to customers already, and I'm very excited to launch this to market in the coming months. Lastly, we just released about two weeks ago what we call our Puma Visual Navigation System. As Wahid mentioned earlier, we've been investing for a few years in this type of capability, focusing on the next fight, peer versus peer, anticipating that, you know, that was gonna be the next fight. We've been hearing about it, China, Russia, and now we're in the middle of it. Timely enough, we're releasing this product capability to the market now, and it allows the user to perform a complete mission in GPS denied operations. If the system is being jammed GPS, it will automatically switch to GPS denied operation during the mission and perform the mission without GPS. The way that it does it is through IR sensors, using VIO or visual odometry, and we also have a laser range finder on the system as well. Periodically you can ping the ground and detect the elevation that you're at and match that to the DTED maps that are on the system, so it will correct its GPS. We're getting probably less than 1% drift on the system, but once you use the laser, you're back to zero. You may or may not wanna use the laser, depending upon whether it's a night operation and you don't want the enemy to see the laser, but regardless, without the laser, you can still operate GPS-denied. We did focus on the hard part first here, which was being able to perform GPS-denied operations at night. We started with the hard problem first, which was if we could do it at night, we know we can do it during the day. A lot of people out there are talking about GPS-denied and claiming they can do it. Can they really do it in the operating environment that it's needed to do it? This system can, and we're excited about deploying it. With that, I'll hand it back over to Jonah. Thanks everyone. Appreciate it. Great. Thank you, Trace. I hope by now you're starting to see some commonality in what customers are requesting and how AeroVironment is responding to those requests. You've seen VTOL, you've seen flexible payloads that are easy to install. You've seen flexible comms that are easy to accommodate. You've seen the term trucks. You've heard the term trucks, right? These are platforms that can do a variety of missions with a variety of payloads because that's what our customers are demanding and what our customers want, and you're seeing it across the board in our UAS systems and how we're responding. Now, though, I'd like to introduce Brett Hush to talk about something a little bit different. We've talked about systems that can fire Switchblades, but now we're gonna talk about Switchblades specifically. Brett has been at AV about 12 years, which, if you know the company, is just a little bit longer than the TMS business has been around. He was a founding member of that business. He's led that business. He comes from a great background in the aerospace and defense industry himself. He had a VP role at Teledyne, for which he worked at for nine years prior to coming here to AeroVironment. He's also worked at a host of other aerospace and defense primes that I'm sure you would know by name. With that, I wanna bring Brett up. He's grown this business into a multi-mission, multi-missile, you know, with multi-missile capabilities, and he's here to talk to you about, you know, what makes a Switchblade and what really differentiates us out there in the marketplace. Brett, come on up. Jonah, thank you. Okay, before I get started, the first thing I would like to address is the challenge that my colleague, where is he? He's hiding now. Right here. I'm here. I'm right here. Has put on the table for Gorik and I to become larger businesses than the small UAS. We fully accept your challenge. To make it completely unfair, we're gonna leverage every bit of technology, advancement, and investment you're doing into our businesses as well. That is part of our corporate strategy. These are not businesses that are run completely separate. They have a lot of synergy in the technologies, and you've heard about a number of them already, whether it be on radios, on sensors, on artificial intelligence, lightweight structures, and so on and so on. With that, let's jump into it. I'm very excited to be here. This has been kind of an unusual situation. It's my passion for the last 12 years. All I have done and a ll I think about is loitering munitions and how to bring that into the DoD and our close allies and make that a game-changing capability. We've seen a lot of change over this time frame. We're at another kind of turn in or inflection point in front of us as far as customer adoption. I didn't get instructions, but I think I know how it is. Okay, there we go. Okay, family of systems for tactical missile systems. On the far left-hand side is our Switchblade 300, which has really been our bread and butter for the last decade or more. We first fielded in about the 2010 time frame with that system in very small quantities with special forces groups. Then in 2011, the U.S. Army did a military utility assessment in Afghanistan and determined that there was significant utility of that system and that they wanted some changes and that they would take that requirement over and try to establish a program of record. Since then, for the last decade, the U.S. Army has been the primary program office designated by DoD to procure the systems for all the other DoD users. We've got all the special forces, we've got the Marine Corps, as well as regular Army using the system. The program office under PEO Missiles and Space and Redstone Arsenal has been our primary customer for that system over the last decade. A lot of robust work with them. We've built over 5,000 of the missiles over the last decade. You've heard from the other presentations the technology advancements that while we talk about we've built 5,000 of them, we've been continuing to evolve and make the system better and better. That's really one of the advantages we have in the marketplace as being the company that introduced loitering munitions into warfare is that we've had that feedback from users over the last decade that we continue to roll into the product evolution to make the tracker better, to make the user interface more intuitive and other features that we put into it. Traditionally, Switchblade 300 has been launched mostly from a single tube, kind of like a mortar launch, so to speak, about a 21 in tube in length. We've also built a multi-pack, six-pack, that is in a fixed location and it can be launched remotely from the relative safety of additional cover or a TOC, a tactical operations center. We are working with a number of industry partners to integrate it onto ground mobility vehicles. We've done some press releases on how we're integrating and doing work with General Dynamics on their platforms going forward. While the Army had intentions to move forward with a program of record, which they called LMAMS, Lethal Miniature Aerial Missiles, that never made it all the way to a program of record. While they've been continuing to buy in fairly good quantities every year from us under urgent needs that have come out of various COCOMs, whether it be CENTCOM's AOR or AFRICOM, and of course, most recently, what's going on in Europe. There are additional programs of record that we are pursuing with the U.S. Marine Corps, which has announced they have a program called Organic Precision Fires-Light. We think we are an excellent candidate to meet those requirements. SOCOM has a similar program as well. We see this, while this has been a robust business for us for the last decade, we see it just continuing. Then on top of the administration's change in export policy, which is more favorable to exporting loitering munitions to our allies, we believe that we can expand the export beyond the publicly announced close allies that's already been stated out there. Blackwing is a close derivative from a technology standpoint and from building the product is very similar to Switchblade 300, but it does not have a warhead. Its job in life is to be launched out of a U.S. nuclear sub while that submarine is submerged. The tube goes up to the surface and then the UAV pops out of it and provides situational awareness to the sub operator, which allows them to know kind of what's going on beyond what periscope situational awareness would give them and give them targeting information for organic weapon systems like a torpedo or provide targeting information back up through SATCOM to another system like a F/A-18 strike group or something like that. It's a really great capability, relatively low quantities compared to Switchblade 300 because of who it's used by. We continue to have year after year on multi-year production rates for that system. We envision there could be some evolution of that over time as well to weaponize it or add other types of effects into it. Switchblade 600 is our 300. I like to call it our, the big brother. When you think about a Switchblade 300, it's 21 in is what the tube stands, which is probably about there. Switchblade 600 is over 60 in in height. While it has the same functionality, how it all started was some of our existing Switchblade 300 customers came to us and said, "Hey, I want all the same capabilities that Switchblade 300 has, but I want to be able to go way beyond that in duration and distance to attack targets. I want to be anti-armor capability, which Switchblade 300 has, was designed as anti-personnel and anti-material, light material, like unarmored vehicles, like stop an engine block or take out occupants inside an unarmored vehicle. We developed Switchblade 600 for USSOCOM, and a couple of the elements within USSOCOM are our current customers. That has transitioned over the last year and a half into production. We're building those in the same factory that we built the Switchblade 300s. We're also working and have announced, put out some press releases that we're integrating Switchblade 600 onto a maritime asset for SOCOM, onto a boat, which is a very challenging project, but very exciting as well, being able to launch these types of things in various sea states, and have it completely controllable and perform the mission. Jackal is our latest development, and this is all focused on an air launch, a loitering munition that can sprint and loiter. That's a new concept for sure. The ability to be launched off a rotorcraft helicopter, and be able to race out quickly to the target area much faster than our propeller-driven systems. We've teamed with one of our industry partners we've worked with for over a decade, Northrop Grumman, and we're integrating a turbojet propulsion system into it. It'll sprint out to the target area very quickly, and then the wing will fully deploy, changing the aerodynamics, the lift over drag ratio of the system, and you're able to maneuver and loiter in that area and have the same similar effects that we've had with Switchblade 300 and 600. That's under a U.S. Army program that us and Northrop Grumman are one of the competitors in that. Some of that testing is ongoing right now of that system. Our objective there is to, with Northrop, to be one of the winners of that program, which is Long-Range Precision Munition for the U.S. Army. It comes under the same program office that has historically bought the Switchblade 300s and most recently is buying Switchblade 600s. We've got good relationships. I think we understand the customer's needs and requirements and think we have a good shot at that. Now, that will be a development program if we're successful, that'll be a development program funded by the U.S. Army for the next two to three years. It is targeted to go on Future Vertical Lift platforms and probably first go on to like an Apache aircraft. I have a video and just set the stage for it. This is an operational scenario with Switchblade 600s showing how they can be used in a scenario to engage targets. This is done in a cooperative engagement with a Puma that is identifying the targets and then providing that targeting information seamlessly to the Switchblade operators. Okay, that was exciting. Good capability. Probably a lot of people wonder what's unique, what's different about a loitering munition or missile versus other weapon systems. The U.S. and our allies have a lot of different munitions and weapon systems out there. The Switchblade loitering munition has a lot of unique capabilities, okay? I wanna go through a few of those. The fact that it's very portable, you know, whether it's the small one, which three of those can fit in about a medium-sized backpack, for an operator, and the ground control system is very portable, to the Switchblade 600, which you wouldn't call it backpackable, but it's very portable. It doesn't require, you know, a dedicated truck like some other missile systems that have similar ranges. Kind of think about HIMARS, and that's a fantastic capability, but it requires a dedicated truck, and that's a target all the time. There's only so many of those that might be on the battlefield. Switchblade 600 fits kind of in that same capability to be able to strike beyond your enemy firing on you and be able to do it in a way where you can maneuver very quickly and move away from that position, which would then become a threat. Both systems, the 300 and 600, are designed to be set up very quickly and to be able to launch. You know, 300 can be used as, you know, troops that are on patrol or going somewhere, and they come into contact. The highest risk to our forces and our allies is that initial troops in contact. The ability to respond to that threat very, very quickly has made that a very successful product. Within two minutes, that can be launched and put effects up over the enemy. The systems are based on having a man in the loop, or sometimes we'll refer to man on the loop. The operator doesn't manually fly the vehicles. They would pre-program way points, you know, similar to what we do with our small UAS. But the operator's getting full motion video throughout that whole mission, the ability to be able to have situational awareness and make other decisions after the initial decision, which is launch. Traditional weapons, where you're launching something with a fixed GPS location, or a mortar or artillery, there's a decision to fire, and then there's an effect, and that effect might be good or it might be bad, and things on the battlefield might have changed from the decision point to when it happened. With our loitering munitions, the operator is in that loop the whole time and has the ability to make a second decision based on what he or she sees in the situational awareness and to be able to maneuver to a safer, attack angle, where maybe you'd get greater lethality and a lower chance of collateral damage. That operator in the loop is a key differentiator of loitering munitions versus many other weapon systems. The precision strike. Well, there's a lot of weapons that are precision strike, and you can get it by a GPS location, pre-programmed. It's gonna hit a particular location. You could lase it with a laser designator, but then you would have to have some piece of equipment or person very close to the target that you're lasing it, and then that weapon system would come into it. What our loitering munitions do is they have a lot of technology built into them that gives them an optical tracker so the operator, from a far distance, can be able to select targets, and then the onboard optical tracker takes that in with precision down to the target. Whether that target is stationary or moving. As you saw in the video, the car is racing away. In a lot of battle situations, you have fleeting targets, and you wanna be able to address those. Imagine trying to address a target or a fleeting target with mortar or artillery. Very hard to kind of predict and lead to get those. Having a weapon system that has the ability to track organically on the vehicle itself is a key differentiator. Then I mentioned a couple times low collateral damage. We have a patented capability of wave-off, and the ability of the operator to determine, "Hey, there's a target here, but I'm gonna get my..." The most vulnerable part of that target might be coming around from the backside. It may be coming in at a shallow angle. It might be at a steep angle. With loitering munitions, the operator has all that flexibility to do that. That's unique, I would say, within loitering munitions. Kind of a little bit more detail, and I'm not gonna read through the specs that are on the right-hand side, but Switchblade 300, kind of the key way to think about this is this is primarily the man-portable system. That's how it's been envisioned for most of the years. Initially as anti-personnel, but it also has a anti-materiel capability as well. To disable, let's say it's a truck or a convoy, the ability to disable those by going after the engine block or attack fuel vehicles or anything else like that. Very portable, very flexible, and we're also working to integrate it onto other platforms. This is one of those scenarios, and you'll see kind of from the bottom line, you know, the portability when you take the missile and the ground control system that it can be carried by an individual soldier, sailor, airman, and marine. The rapid engagement, and then the full, you know, man in the loop or on the loop, and the ability for that onboard tracker to take over and has a lot of autonomy in engaging targets. This particular scenario, I think a lot of us were watching the news many months ago, and we saw the Russian convoy coming into Ukraine, and we're watching that, and we're going, "They don't have air superiority, so you can't, like, send in fighter or attack aircraft." Loitering munitions is a perfect fit for those scenarios. We believe, and we've seen a lot of customers in our community have now pressed the I believe button associated with loitering munitions make sense even in a peer-on-peer threat environment. I think prior to this current conflict, there was still reluctance within DoD leadership to say, "Hey, this is a great weapon for the coin fight, for the counterinsurgency, for what we've done in Afghanistan, Iraq, Syria." I think views have changed dramatically with what has happened over the last six months. We think we have a capability that supports. I think everybody's aware that the U.S. government has gifted as foreign military assistance to Ukraine Switchblade 300s, and those have gone into theater and are performing well. We have a capability that was shown in the video, which is if the operator also has a small UAS asset like our Puma AE or Puma LE, they can use that to find targets and then electronically transfer that target information to the Switchblade operator. The Switchblade operator with this software package can look at his vehicle's video of the situational awareness, but also see the feed from the Puma that's being streamed to them and say, "Hey, I like that target. I will accept that target," and it electronically gets transferred. It makes the engagements higher probability, higher assurance that there's not an error. Okay? The small UAS, like the Puma, would sit there and do battle damage assessment afterwards to determine is there another action required after the first Switchblade is launched. Switchblade 600, getting spec sheets. I think the big difference here is, you know, for longer range, anti-armor. Of course, there's a lot of talk about anti-armor systems in the press and in the world today. This system carries the Javelin penetrating warhead. Javelin has had a lot of success in the Ukraine fight, but it's limited by a line of sight target where the operator has to be able to see through an optics package that line of sight target and engage it, and that's typically maxed out at about 4 km. Switchblade 600 can go out to 90 km. Way beyond the range of the Russian artillery and to be able to defeat the targets. We don't think of Switchblade 300 or 600 as completely replacing other weapon systems. We think that there's an integral fit for various threats and various situations where these make a lot of sense. Okay? This graphic kind of gives you an idea of, you know, the range advantage that a Switchblade 600 can give the user versus other weapon systems. If you know, watch what's going on in Ukraine today, and there's about a 1,200 mi line of defense, and the Russians have a numerical superiority of artillery, and there's fairly limited HIMARS and other weapon systems that can strike beyond the range of the artillery. Switchblade 300s can be distributed across that battlefield very easily, and change the outcome of those battles. We're getting a lot of interest from customers, not only the U.S. DoD, the Ukrainian government, as well as the allies in the area. Kind of a busy chart, but the basic CONOP of Switchblade 600, very similar to 300, is an operator can set up a single tube, which again is kind of like a mortar shot, set up a ground control system, and then he has his tablet to be able to see the real-time video and select various options of how he wants the weapon system to engage targets. That gets launched, and he can go with his standard GCS package. He can go up to 40 km, or if he hands it off to a forward operator, it can go all the way out to 90 km. The Northrop Grumman Jackal program that we talked about a little bit earlier, you'll see that's pretty much the graphic of it there. You'll see the wing, the main wing that's deployed. Initially, when it's launched off the rail, it'll be in line with the vehicle, and the turbojet will be going at full speed, sprinting out to the target. When you get in proximity of the target area, that wing will fully deploy, which would be perpendicular to the fuselage, giving it a lot more lift, slow it down, and maneuverability. That's all I have. Thank you, all. Can I ask a question? Yeah. Jonah, can he ask a question? Yes. What's the difference between Jackal and just a cruise missile? Can you repeat the question? Yeah. What's the difference between Jackal and a cruise missile? The size of it and the features that I talked about of a loitering munition is in general cruise missile getting a fixed position that's pre-programmed and it can waypoint navigate out to that target. In this case, there's still an operator in the loop who's getting that real-time video and can make further decisions about what target he wants to attack. We will be adding more and more autonomy into this that will help the user, so there's less decisions that they have to make. Great. Does that answer your question? Yeah. In principle, it's a cruise missile with a person in the loop that can modify its path, I guess. Yes, much smaller in size. Okay. Okay? Yeah. Very good. All right. Thank you. Great. Thank you, Brett Hush. Okay. We've made it all the way to lunch. Lunch should be here any minute. We're gonna take a little break. Hopefully, lunch will come in. We're gonna get set up for the Q&A session, and you'll have a chance to ask any more questions of any of the speakers that have presented today, or frankly, of the rest of the team that's here. Let's take a break for now. We'll maybe take a 5-10-minute break, and hopefully, lunch will be here in that time. We could suggest that as an option to cut costs. Oh. That's how you get in shape. There is a value to playing the video game. We're about to get started here. You can keep eating. We'll start in five. Appreciate your time. Thank you. You think it'll be the same here? All right. Well, this brings us to the Q&A portion of our agenda. Please feel free to raise your hand if you have a question. I'll pick on the folks, and I'll help divvy out the questions to our panel here. This is one I'm sure you're looking forward to. We're looking forward to it as well. Austin. Hi. What do you think about the CR in terms of the one that they just passed and you're going into mid-December? Are you confident that it'll get actually done sort of in mid-December or in early January when the new Congress starts, or are you concerned about a situation where it drags out until March 16th again? Wahid, do you wanna take this one? I'll take it, but I'm not sure if I'm the expert. I would say, you guys know this better than we do because you understand the industry really well. My personal view is that, it's likely that it's going to continue. Historically speaking, it's been not common that they've had a budget passed in the last several years, not just one or two, until the beginning of next calendar year. Regardless of that, I think for AV, the implication for us is not gonna be really significant one way or the other because the programs and the opportunities that we're tracking, they're continuing irrespective of the CR, in general. New starts, the newer program records that are on the pipeline and the horizon that's further out, for us, those would be somewhat affected, but it's more of a long term and not short term. I don't consider that to be a big issue for us, this fiscal year specifically. Great. Does anyone add anything? I would just add to that, I see it the same way as we're all forecasting our business with a set of assumptions. I would say my assumption right now is mid-March based on history, and that flow down of some funds that we're planning on would happen prior to the start of our next fiscal year. From a TMS standpoint, we're planning that it's not gonna happen until probably the March timeframe. Just as a reminder. We don't know. We're on April 30th end fiscal year. Okay. Ken? Yeah, you gave an example of 10 different programs that could potentially be billion-dollar plus. I mean, a lot of detail on FTUAS. Which of these others could potentially happen in the next 12 months, and sort of how does the timing look on those, or probability and which ones maybe should we really focus in on as more of a near-term opportunity versus if it's just something that's out there a little further? Why don't you take it at the beginning, and then if you guys can fill in the gaps on the individual programs. I think that one of the beauty of our business is that we're pursuing several programs of those natures and size in different one of our product lines. The main reason why we highlighted FTUAS is 'cause the most recent one that we made an announcement, there was an award, and we're in a facility which you haven't been to before and acquainted with the product line. It's really critical to the success of our MUAS because we've been focused on that. By no means does that mean that we don't have other programs that are in the other product lines that are of equivalent size or scale, and probably even time-wise in a similar or even faster track in some ways. I would expect the programs that are for the TMS business, the ones that are already in progress, the U.S. Marine Corps programs, the U.S. SOCOM programs, that are gonna continue to go at a similar pace, if not faster. I think the other branches of our services would pick up similar initiatives or programs most likely now that Switchblade is a validated capability and we've fielded it and there's been deployment in Ukraine and there's also good data behind that. Lastly, I would say also on our small UAS, there are several programs that Trace and his team and our small UAS were pursuing. They could be a little bit longer term in nature, whether it's a non-lethal UAV such as our program such as LRR. There's a program called LRR that, you know, we're looking forward to, long-range reconnaissance. I think what it is, it's really difficult for me to say which one's gonna happen first versus the other. They're all moving at a similar pace. Some more disciplined approach by the customer as to when they are gonna do certain milestones. Some of them, they're moving at a pace that they can to go fast enough. I think we have opportunities in all the different product lines that we've got in terms of potential programs and deployments at a similar sort of a timescale. They're all gonna happen not overnight, but there's progress milestones or sort of stages of those programs that are gonna happen within this fiscal year, next fiscal year, that'll lead to a program of record maybe in 1.5, two years. Then you guys wanna add? Yeah, I can comment on Long-Range Reconnaissance. Just recently at the AUVSI Pathfinder conference, the PM UAS briefed their kind of timeline for that program of record. Assuming that the government holds their schedule, which we all know is questionable, we expect that competition or RFP to come out about the next GFY. Not this GFY, but the next GFY. Probably before the end of calendar year 2023, we would expect to see an RFP with the down select the following calendar year in 2024. That program is laid out over a 10-year period, so it starts off very slowly. When we talk about a billion-dollar program, it equates to that, but it's over a long, extended period of time, with fielding starting in the GFY 2025 to 2026 range. It's got a long tail. Brett, you wanna comment? Yeah. I'll start with just a comment. While we're talking about DoD programs of record, the near-term demand signals that we're seeing are more associated with foreign military aid in Europe. On the programs of record side, while we have a list, I think there's five of them that we highlighted, the U.S. Marine Corps is moving out faster than any of the other services relative to loitering munitions. If you're tracking, the U.S. Marine Corps made a structural decision a few years ago to eliminate their main battle tanks, the M1 Abrams, remove the heavy mortar systems, and go to a lighter, faster force structure leveraging loitering munitions. We think we're in a very good position for which we think the first one that'll be picked up there is the Organic Precision Fires-Light, which our Switchblade 300 is one of the candidates for that. We're expecting the RFP to hit somewhere in the middle to late 2023. Okay, so it's a little less than a year from now we expect to get the RFP, and I think we're in a good position with that. Gorik, did you have anything to add? Yeah. I would say one of the reasons we highlighted FTUAS is because that program is upon us. It's no longer an event in the future, it's being executed. The program has been very successful in obtaining the necessary funding. In fact, all indications are that the conference committee will add to the budget line item request that the Army has turned in. For us, the timing of the second phase of FTUAS is kind of imminent. We think it'll be January, February timeframe. It'll be dependent, obviously, on the budget approvals and whether the continuing resolution goes to March or not. The other advantage we have is the service programs and our programs of record don't get impacted by CRs. Their funding is O&M funding, so it's much easier to continue those operations. They don't get impacted, and so we expect those to continue. We, you know, we're in the thick of things for FTUAS wins. I think there was a good point Brett mentioned as well, which is that these are large programs that we're tracking that give us, you know, strong traction within a particular branch of the military, and then through the carryover to international allies who train with us and who, in a lot of cases, take the same solutions that we have deployed ourselves. You know, while these are large programs that we're tracking, there's a lot of international business, there's other domestic business that we weren't highlighting today but is still part of the plan for the company. There's a significant amount of small UAS and TMS, primarily, and what we call non-programmatic acquisition funding dollars and projects, call it, opportunities that we track domestically, internationally. It's a very stable part of our, what I call overall franchises. Trace, you know, programs of record are very important to the business. They've been very helpful for allowing us to extend the SUAS franchise to over 50 countries. Winning some of these programs, especially given the opportunities we have with international customers now, could really open up some of the same doors. I just wanna, sorry, add one more point to this comment to this topic. Brett mentioned about the quite significant amount of international opportunities for exports of Switchblade and the two variants. Trace's business, our small UAS, very similar. We see significant number of opportunities internationally from lots of different countries due to the fact that we've had a lot of success and then also to renewed interest for drones in general, especially our drones because they're the workhorse of our U.S. military for the most part and across the whole globe, essentially. I would expect that to actually continue to gain momentum over the next several quarters to continue this year and next government fiscal year and even our next fiscal year. Thanks, Ken. Brian? Yeah. Oh, sorry. I was cornering Trace last night over a quick beer but trying to understand kind of near-term drivers. Yeah. The future for the business seemed to be all sales to foreign militaries. Is that correct? That's where the big upside. I'm talking one, two, three quarters out. I would say for TMS, yes, but also a combination of domestic, too. U.S. DoD has given up a lot of its own inventory. Okay. Backfilling that inventory- Okay. of Switchblade 300s and also not having enough Switchblade 600s, we believe is a near-term opportunity that is gonna happen in the next one to three quarters for us. Yeah. I would add to that, you know, it's public record, government FY 2022 funds that were approved for Switchblade. I think the number is roughly $64 million. And that has not been awarded yet, so we're tracking that. And then- Those are just replacements of what already got shipped. Is that correct? Just replacements? No, that was associated with U.S. Force Structure. Okay. The drawdowns generate additional funding to the Army program office, which will come to us as well. Yeah. Switchblade, there was already funding for GFY 2022 that our TMS business has not been awarded yet, but it's already approved funding. We're technically running almost about a year behind the actual budgeting cycle in terms of the award process and for us to deliver products. That's one piece. That's generally for the U.S. DoD's past sort of op tempo of how much they use, how much they train, what they do in terms of the theaters. On top of that, you add this sucking sound from Ukraine consumption. Right. That, that's consumed the U.S. inventory, and that will make its way probably in the next government fiscal year in terms of budgeting process, this 2023, this fiscal, government fiscal year. Then on top of that there's additional demand for Ukraine and other allies that comes in terms of an FMS sale. Since we have approval for DCS and FMS, that could also mean an additional demand that could happen long term in the next, you know, several quarters. That's just TMS, just for those two products. Small UAS has a very similar sort of construct. Domestically, there's smaller opportunities, but several of them within the U.S. services. Many international opportunities, some small, some very large, and that'll continue to grow as we've done in that program. Then long-term programs that he mentioned, such as LRR. There are also international programs. They're not on the scale of an LRR, but quite significant international programs that our small UAS business is actually engaged in that could lead to incremental revenue in the next two to three quarters. Yeah. Then, now, medium UAS, we all know the story there. The opportunities are to continue to deliver services to the SOCOM as part of the lead of that program, call it. Two is to execute on FTUAS, and three is that all the international allies that we have really didn't have a lot of chance to demonstrate the capability because of the COVID situation. This acquisition happened during the thick of the COVID. Now we're getting engaged with, and he's doing demos, and he's doing presentations and the climate is such that those customers saying, "Yes, I gotta have this." That is going to hopefully turn into some in the near midterm sort of timeframe. That is just these three product lines. We have UGV business, and then our MacCready Works—there's a significant uptick in the U.S. DoD's spend on our types of capabilities, future concepts of operations and missions, that I believe we're in a very good position, and we're generating some revenue from that will continue to be, you know, incremental, you know, bumps in terms of increases in our demand. If I may add something here, too. There is no question that the war in Ukraine has heightened our visibility and kind of made our products a little bit more urgent to a lot of the- Top of mind. Yeah. Top of mind and urgent to a lot of. That's across the board for every product that you can think of. It's not just SUAS or TMS, it's also MUAS. We also are seeing a trend where the international customers aren't necessarily just buying hardware with FMS funds. They're also willing to commit DCS funds, Direct Commercial Sales, to start the procurement and to start getting familiarized with the hardware. No question, the war has been a catalyst, and the interest level has gone up internationally, mostly from allied nations. As Wahid said, we've had an opportunity for the first time in a couple of years to actually get out into the field and service the customers by demonstrating the products to them. We have a very full demo docket that is a nice problem to have. Thank you. Peter? Yeah. The demand for just about all your businesses continues to be, you know, very strong. Maybe you could just describe or provide some color what you're seeing in the supply chain that maybe could hold back some of your ability to deliver upon this if we think about the next 12 months. Obviously, there have been discussions that things have gotten a little better, but maybe if you could each make a comment on kind of the supply chain issue. Why don't you guys go? Okay. Yeah. Let me take a shot at it. Yeah 'Cause it's my answer is probably the simplest answer than everybody else. You can see that we build most of our stuff, so that really does help our situation here. Buying carbon or wire is less of an issue than it is some of the other complicated electronics that you need to go buy. However, having said that, we have to plan for the issues associated in the supply chain, and that what it really does is it's added to our lead time. It's added to the lead time of the deliveries. Now, because we operate very much like a commercial company as opposed to a typical aerospace company, we accommodate that, right? We plan ahead of time, and we do risk buys, and we manage that. We have not had a negative impact in our delivery lead times to our customers associated with the supply chain. It's all been handled by just a slightly different way of planning for the product. Yeah. I'd say compliments to our CEO. When the war started, you know, he challenged each one of us as leaders to get out in front of it and go drive the factory and level-load the factory to prepare for what demand we could foresee coming. From an SUAS standpoint, that's what we did. We received a contract for 22 systems for Ukraine in April timeframe, and we shipped it in two weeks. So really seeing the situation and getting the direction and you know the ability to go do what we needed to do allowed us to get out in front of a lot of these issues. Now, they pop up every day. I mean, we see, you know, we're battling supply chain issues every day, even with the ability of level-loading the factory and driving a significant amount of demand that we anticipate coming. I think we're able to knock those down because they're one-offs versus, you know, a whole system worth of parts. I think we're well positioned to deal with it. Okay. Yeah. I would add to it, thank you, Wahid. We made some pretty bold decisions. Supported through the CFO, I think he wants to. I'm sorry. Oh. I'm the CFO. Kevin. He gave us the money. We couldn't have done it without the support of Kevin. We made some pretty bold decisions, looking at what was going on in the supply chain. We went out at risk with fairly significant orders for material. Then we started just whack-a-mole, dealing with all the issues. You know, things that just seemed so simple in the past. Processors, you know, standard processors are built by the millions. FPGAs, you know, little integrated circuits, capacitors, all sorts of things. We have worked very, very aggressively, I think outmaneuvered a lot of other companies, in our ability to go work with the U.S. government, work with the supply base, go up into the highest level, down to every individual supplier where we're having an issue, and get it turned around. What we've seen is every time we've followed the process all the way, we get success. Now, it has been a lot of work, and I think it's gonna continue. But, we're leaning pretty far forward, for the demand that we know is out there and is coming. Yeah. I just wanna say one thing. This is a direct quote from Wahid. I know I remember this clearly sitting in a meeting when Wahid said, "The worst thing we can do is to go execute our order projections and then not be able to deliver the hardware. We haven't done that, right? We went and planned for that. We were directed, encouraged to go plan for that. That's honestly the way it's been. We've handled the issues in the supply chain. As my colleague said, things happen almost on a daily basis. We have issues on a daily basis. Even under normal circumstances, you have supply chain issues on a daily basis. We've been very aggressive in getting ahead of the demand and building on risk and accepting that responsibility, and we have not let any of our customers down. I was gonna make a general comment. We do a lot of different things in this area. I think that relative to our size, we do quite well in this area. I sit on a weekly status review of the sort of obstacles that we're faced and what are we doing to address those for every product line. Our GMs and P&L leaders, they do the same thing. They have their own cadence. We have a dedicated team related to the supply chain for the COVID situation that addresses specifically our tactical missile systems, which has been really high sense of urgency. We work with the U.S. DoD. They've been extremely helpful at the Office of the Secretary of Defense level, for industrial policy. We're having weekly calls, visits, conversations. We're reaching down to the supply chain, as Brett mentioned, multiple levels below our subcontractors even, to the component level folks, to the actual manufacturers such as Intel and NVIDIA's of the world, all of them. Majority of them, I should say, all of them. The other thing we do is like at-risk buys. We've done that. We also have structured our supply chain many years ago, three, four years ago, where we have contractual agreements with several key suppliers that carries at-risk inventory for us based on our forecast. Financially, it's not really a big risk for us, but it is part of the long-term, our combined planning, integrated planning process that we sit down with those suppliers, and we say, "This is what we expect next quarter, next six months, next nine months, next year, even year, two years from now." They have a contractual obligation. It's part of the agreement with us that they have to carry a certain window of time. That's why throughout the whole COVID, beginning of COVID, nobody thought it's gonna be 2+ years, three years. For the first year and a half, we were literally unaffected because we did all those things that allowed us to carry on. Now that the situation's gotten worse for the world, for everybody, and our planning of long-term is, you know, could only take us so far. Overall, you know, this year we've given our guidance, and we've taken that into account. Then we'll plan for our goal is also not just this year, or as I said, you heard the strategy. We believe that we're on the cusp of quite good inflection point in several of our product lines, and we would like this to continue more than just a fiscal 2023, sort of a outcome for AV. Fiscal 2024 and beyond, we'd like it to be similar to the strategy we mentioned, consistent with our expectations. Yeah. Although not on the point to provide any guidance. Yes. Yeah. Shifting gears to UGV for a bit, could you kind of talk about how integration at Telerob has been going so far? Also just if you could take it a step back even further, the strategy going into the acquisition, and why move away from, like, kind of the aerial core to more ground systems? What was really the thought process behind that? Sure. [Mining's] not here, so I'll take that one. Yeah, I was gonna say. Yeah. No worries. Generally speaking, you know, we initially could see the track record. It started with very small acquisitions to get our methodology, our discipline, and our process down and sort of orchestrated well. While many of our team members, if not all, have experiences with integration, acquisitions, even mergers and all that, pretty much almost all of us have experiences there. Any company that takes on an effort like that, you have to develop your own battle, so to speak. Telerob is the most complex of the four or five that we've done. We intentionally have taken it a multi-stage approach and a slower approach, A, because it was COVID, two, because it's a different country, three, it's a complete new domain, four, we're doing it with all these other things that we've got going on and a lot of other domains. We're not in a rush to try to integrate Telerob very detailed, deeply as we've done with the other businesses. Planck was a much simpler and much easier sort of tuck-in integration that happened literally in a matter of a week or two. We put them on our systems, our IT systems, security, computer systems, networks and all that. Arcturus medium UAS that Gorik is running is actually ahead of their integration schedule, generally speaking. The biggest lift there was their ERP system. They're now on our standard, you know, enterprise-wide Oracle ERP, and they're operating the manufacturing floor you saw today. The supply chain, the entire MRP, ERP is driven by that. Telerob, we're taking a different approach. We're going slower because of all the things that I mentioned. There's already a bunch of back integration work that has been planned and is executed, and there's significant more to come in the next year, two years, three years. Pretty much all of our functional leaders from finance to legal to manufacturing, IT, we develop these plans before we actually execute and sign the deal. We have a plan. We put that together. It's part of the due diligence, and then we go execute, and we keep track of that and adjust based on, you know, surprises, so to speak. That's the integration part. It's slowest of them all, intentionally. It's not affecting that business or ours, and also this was not a cost synergy acquisition. None of these are for cost synergies. Primarily it's for growth and for technology synergies and temp customers as well. The second part of your question about the, what was the rationale behind it. The rationale is back to that fundamental future state, intelligent multi-domain robotic systems. We believe that the combination of ground robots, whether the ones that we make today or the ones that we plan on developing in the future, and our air robots and our autonomy, is going to do a lot more missions. Another thing you might have noticed in all the videos you saw, we don't just talk about a product. Here's a widget. We refer to it from the customer's perspective on mission. What is the mission and how does our capability fit into that mission? UGV is a very critical piece of that. In the long run, it's gonna be even bigger as we grow into more of these systems, you know, in the long term. We have several activities in those areas. They're not short term. You know, short term, we gotta do what the businesses are doing, especially Telerob. Long term, that's where we're going. Autonomy is this significant overlap, almost 90% overlap. What we develop for our UAVs, that could be applied to our UGV systems. There is benefits on the ground robots with our space initiative, with NASA. You know, the next NASA mission, they already publicly announced it's going to be not a rover only or a UAV only mission to retrieve the samples that are on Mars. It's a combination of the two. It has to be a rover that can also fly and it also has a robotic arm. One of the core competencies of Telerob in the industry is its precision robotic arm technology that doesn't require an operator to bring the robot back to change the tool. It's done on the vehicle itself. That's very unique to Telerob, and it's the best technology that exists in this industry for that class of robots. That class of robot is very applicable to the space initiative that we've got in all of the efforts we do. Those are just some examples, you know. That's why we wanna do this long term. The other challenge with that, I'd say, I'm sorry, I should also mention, is that we need to be able to help the customers realize how to buy. Today, every program is a widget within the U.S. military and allies, and they don't really think of it. They're starting to talk about it. They're starting to really preach it. To actually do acquisitions that have requirements that are interdependent with more than one domain, I think it's still a barrier to bigger adoption and synergy long term. Yeah. Maybe along the Go ahead. Along the lines of what Wahid was saying too, you know, we have these ISR assets, the aircraft that find things, right? They find the bad guys. They find the targets. We have assets and product lines that do something about the targets and the assets that they see. We have Switchblades that can take them out. We have ground robots that can defuse bombs. We see customers seeking these end-to-end missions, and we wanna provide the end-to-end mission set. In that respect, it was an adder to help address, you know, IEDs that we were seeing with our own, you know, UAVs. Yeah. Sorry. I mean, no, it's cool. I was involved with the Telerob acquisition as well on the front end. I mean, in today's fight, they're gonna need a lot of ground robots in Ukraine to defuse bombs, mines, whatever. Having a Puma in the sky watching that activity, surveying the battlefield to ensure there's no other threats is just another feature that, another tool in the toolkit that enables them to perform a mission that they couldn't perform previously. You'll see the robot today, and you'll probably see a Puma overhead, you know, showing real-time ISR of what the robot's doing and surveying what would be a battlefield. We envision that, and then you throw a Switchblade in there. If the Puma does spot a threat while the ground robot's out there diffusing an IED, now you can launch a Switchblade and take out a target while you're still performing an IED mission and having real-time ISR video. Again, back to Wahid's comment, multi-domain intelligent robotic systems. We see missions in the future requiring all these assets to work together. Ken. Yeah. Hey, two questions. One, you called out $100 million in orders with the call for August, right? In the most recent conference call. Can you give an update on maybe what you saw in September? And did that trend continue, you know, end of the government fiscal year perhaps? And did you see any sort of uptick in activity like seasonally you usually do? And then second, I think bigger picture, I think what a lot of us are struggling with is, you know, sort of a mid-teens top-line outlook for the next few years is good. Doesn't probably reflect the confidence and the bullishness we hear in terms of the opportunity sets when you sort of add it up, right? I think you're probably aspiring to something much bigger than that when you look at, you know, where the businesses can be. Without thinking about a specific time necessarily or a catalyst or program, but when might we start to really see that acceleration? Because I think there's clearly a bit of a disconnect between the opportunity set out there, the 2023 guidance, what we're seeing in the numbers so far. Kevin, do you wanna take that one? I'll let Wahid start on that one. Very good question. The first one. He did say double, though. He didn't say the time. On the first one, I would say we're not in a position to be able to comment on the quarter specifically and how September went or how that went, because as I said, we've provided our guidance last quarter and we have a plan. We felt good about the plan when we provided that, and we'll give you an update when the next quarterly earnings come out. It is the midpoint of our guidance, as you know. It's very much in line with the sort of targets and objectives and ambitions that we have and the expectations that I have on ourselves. In terms of long term, where is this growth gonna come out? It's really, really difficult to give a specific time, but I do know that within the drivers of our business that we see, our ability to achieve a similar success or even better in the next three to five years is absolutely not unrealistic whatsoever. Could it be bigger than that? Of course, it could. When exactly that's gonna happen, really, I'm not in a position to be able to provide any specificity to it, number one. Two, I don't think it's as relevant really to the bigger picture story. We would like to be the leader in the space. These things are gonna happen, and we're positioned really well. Whether that happens in the next two quarters or three quarters, the importance of that is far smaller, I think, long term, honestly. I'm not discounting the fact that the sooner that can happen, the better. Everybody wants us, all of us want it to happen sooner than not—than later. I think in the longer context of what's gonna what should happen, what we believe we expect to happen, and how it would happen is gonna. We're in a really good position. The other point I wanna make is also that, so to give you a little more color on that, is that I think that given the CR situation and all the funding that's provided to Ukraine and the rush that is taking place within the U.S. DoD to get the programs and contracts in place, I would expect somewhere towards the end of our fiscal year that a lot of this would settle down or settle to good outcomes and more clarity. The CR hopefully will be done by then. We'll have our year much better positioned, and next year's, you know, sort of visibility would be in a better position at that point. That's probably very plausible, likely, and something that we could do. Any time that changes, we will be the first to come and tell you. If we know information that's meaningful, that's material, that makes a difference in a meaningful way, we will let you guys know, whether it's within our quarterly results or, you know, before and after that as well. We will stay flexible on that to keep you updated, but I don't wanna set the wrong false expectations either. You know, it's just that something is extremely difficult to predict given the behavior of our markets and customers. I think the message was we're believers in all of our segments, and we think they're all gonna grow strong, and we're gonna show great organic growth, you know, at least of what we've done in the past. With those programs of record, we do think there'll be an inflection point, but it's hard to predict that exact point. Yeah. It could be in the, you know, next six to 12 months. Yeah. You know? Very much so. I know you guys want us to forecast it, but that's where we get ourselves in trouble, you know. I- Is it six or is it 12 months from now? We believe there will be an inflection point. No, I think a lot of us do as well. I just think the challenge is there's clearly an element of trust us, and that's great, and I think there's a lot of trust. There's also then at certain points, you know, we need to start to see the data, the guides, and everything else start to reflect that flowing through. I think we're at a bit of a disconnect right now between where we think we're all gonna be or hope to be in a certain period of time and sort of where we are today, and it's that path. Is it sort of linear? Is it flat for several quarters and then there's a step? I mean, I'm not asking for more granularity on that, but that's something I think we're all struggling with. Yeah. I believe that this year will be, as I said on the call, and we provided the guidance, it's a very strong, healthy year. We're positioned really well. The fundamental demand drivers for us are very, very healthy, very positive. The trends in the market are really positive. The budget sort of profiles look really good. Our position is really strong. Our track record speaks better than all of the rest, if you ask me, despite very, very difficult times in the industry, given all the CRs and the administration changes and, you know, the temperature towards defense in general, all of that, and the Congressional issues that was going on, but we've done really well, in that regard. I don't wanna pat us too much on the back, but I do believe that we're positioned really well, and it's gonna, you know. I've been here 12 years, and I mean that by all means. I've not been as excited and as optimistic about the prospects for our growth than I am now since I joined the company, honestly. Yeah. There's lots of different ways that we can achieve that. The, the number of opportunities that we have to achieve that outcome is large, much larger than what it was before. Yeah. Awesome. If we just kinda lay this out here, it sounds like you talked about significant opportunities for TMS and small UAS sort of in a next three quarter timeframe. If we just think about what's going on macro-wise here, Russia started the war with 200,000 men, most of them the contract soldiers are dead now. It sounds like he, Putin has been able to conscript somewhere if the goal was 300,000 for the first wave, sounds like he's got about 200,000 right now going into the winter. If we just think about how we might see additional awards be issued, would we expect to see that as like an FMS award or as, would we see that like in an OCO contract or one of the Ukraine bills that continues to be passed every two or three months? Yeah. I think generally speaking, majority of the Ukraine-specific demand for TMS will be an FMS demand, through FMS. I believe that much, much more probabilistic that the U.S. DoD would procure Switchblade 300s and 600s for majority of our allies, including Ukraine, through FMS channels, process. We have the ability to do it DCS. They've given us initial approval, but I think that that's the easiest, fastest way to short-term. Next two to three quarters. Long-term, that'll change, no doubt. Okay. On SUAS, we have a combination of both. There's certainly Ukraine-specific demand that are FMS, like they've already placed orders and we are tracking more such demand that is in the pipeline. I think those will be FMS, but there's also some DCS opportunities too. I think as the quarters go further, other countries that are in the region have already raised their hands. I've said that on the last call that we're engaged on TMS and SUAS on multiple countries that have needs for these same capabilities that U.S. DoD is providing to Ukraine and others. I think that will start to keep building more momentum and growing over the next several quarters in my view. Yeah. Those European countries you mentioned, those are part of that group of 20 + that were approved beyond originally, I guess, which is the U.K. That's right. Exactly. Yeah. I could kinda add from a TMS perspective. I'm trying to be careful not to be forward-looking type statements, but we can look back at what has occurred, and what has occurred that's changed our optimism, I guess, with respect to the business, is the export policies have changed substantially. The foreign military aid to Ukraine with Switchblade 300s and 600s was a fundamental shift in U.S. policy. Our ambition within TMS has been always to be more balanced, like our small UAS business, where we're balanced between domestic defense and international. But we were previously hampered by U.S. export policy for many years, hampered down to just the Five Eyes, U.K., Canada, Australia and New Zealand, it was limited to. Without being forward-looking, that's a reality that's changed. Then I would also add to it that, now public, when the U.S. is gonna give foreign military aid through loitering munitions, they're going, you know, in the countries that are asking, it's not a wide open competition. They're going to, even though we're not a program of record, they're going to the established system that the U.S. government has in their inventory, and is currently under a DoD program office. That was a big deal. While the quantity is very small for Switchblade 600 that's been announced, the 10, for us, it's a very big deal for what that opens up for the future. Did you send a thank you card to Putin yet for getting the export policy changed? I- Not yet? I did not. I'll just stop right there 'cause I'll get myself in trouble. Yeah. I just wanna say that we are about out of our time, so we can take one more question, I think. We'll go with Peter. Great. I'll ask one on margins just so we can squeeze it in. Get ready. You know, there's gonna be a lot of top-line demand, and Wahid, you talk to us all the time about, you know, depends on the mix, product versus services, you know, and what the impact will be on margins. But when you think out now, and I'm not trying to pinpoint you on a number, but you think about the kind of outlook that you're gonna have, pretty strong double-digit growth, a lot of product volume, but a lot of different buckets, what's the best way for us to kind of understand if there is a margin opportunity? Do we look back at previously when your product mix was high, those should be similar margins, or should we think that they could be higher because of volume leverage or that there's gonna be headwinds because there's new program starts? How do we think about all that? Yeah. For fiscal 2023, we provided that on the last earnings call, and that's our statement, which was we expect this year's margins, based on the current guidance, to be at or slightly better than where we were last year. The reason for that, we even provided the reason, which was our reasoning was that while the mix is favorable, we have better, higher mix of hardware sales than services, which is more favorable, and somewhat also internationally will play a bigger role than domestic, which is a favorable mix. Then there's also some counteracting force of supply chain constraints and just general inflation-related cost increases that we historically have always passed those along to the customers, but there's a window of time that it takes to do that. Right now, we're in a time where the rate of that inflation, that hike is in cost, in input costs is much faster than the time that we usually give our customers to upgrade, update their contracts and our pricing. So that's kind of out, sort of undo it for this fiscal year. Long term, we've always said we're gonna be a high margin, as you saw the numbers, trends that we were historically we've been at there. There's certainly opportunities as we scale further and grow further. The MUAS gets much bigger and TMS gets a much bigger business, which is our intent in the next three to four years. There should be some more scale-related leverage on the margin side. We're not providing any specific color or guidance on that other than just the general statement that that's what we expect and hope that will be the case beyond fiscal. Yeah, I mean, I'd say for sure you're gonna see more product. Yeah. The products have different margins, so then we'll be talking mix- Yeah At that point. We're gonna get hopefully a lot of leverage on growth too. Just to add to Kevin's point, he mentioned something in doing his presentation that our primary objective really is because we have more growth in front of us in some of these markets that are inflection points, TMS specifically, and MUAS, we're the new kid that is disrupting a very large market. We're gonna put a little bit more emphasis. We're always gonna keep an eye on profitability and margins, but we're gonna put a little bit more emphasis on growth and market share and penetration, because we believe that'll set us up for a much larger franchise opportunity long term for value. That's precisely what we've done with small UAS. If you know, for the last two decades, it is one of the most remarkable, probably franchises and platforms in the U.S. DoD's track record. Small in size, but the kind of business that we've built and the moat that we have around our small UAS, domestically, internationally, is really, really rare and, especially with the margin profile that we have, you know. We wanna repeat that process and that sort of a cycle around our other products and product lines. I feel compelled to. Yes Just to add, Wahid. We've all heard the term drone insanity, and I think a lot of us believe that drone insanity was gonna drive small UAS down a commodity price, and then so that we'd get a lot of price pressure. I think because of our technology advancement and the focus on making stuff that's rugged and really relevant to the war fighter, we haven't experienced that. The only other thing I'd add is on the TMS scale size, you know, we have the facility, the ability to double and triple our production revenue without adding a lot of overhead cost to the business. Because the facilities are there, the touch labor that gets added is incremental. That's what we're focused on, is to get the scale in TMS. Pretty much the same for most of our product lines. Small UAS, MUAS, TMS, which are the three primary product, even UGV is quite significant amount of scale, growth without CapEx or significant meaningful CapEx. There'll be some here and there, but generally speaking, we've got a lot of room for leverage. It won't be a bad thing if we need more capacity. More capacity. Yeah. Yeah. Exactly. Okay. All right. Well, thank you very much, panel. We appreciate it. We just have some closing remarks from Wahid, and then we'll get to the demo. Go ahead. Just hit the slide. Yeah. Again, I wanna thank you all. There's one slide I wanted to say, if you've already heard it before, great success and track record the last five years. I've not seen it this positive in our markets overall for AeroVironment since I've joined the company about 12 years ago, almost 12. Our position, you know, as Brett said, there's always been doubt, can you keep these types of franchise and sort of market share and leadership position? I mean, we've done it. We've done it year after year after year. I believe that our position is even stronger now than it was before, especially because of many key reasons that make it so interesting. Expectations are high of ourselves. We're not providing guidance there, but you can make up your own mind as to what you see based on what you've heard so far. Then, we are committed to a strong return to our shareholders. That will, you know, provide dividend to our customers, our employees, and our shareholders, all three. I really thank you guys for taking the time to come out here. I wish we had more time to enjoy the beautiful Sonoma County area. I know that Mike is local now, and he had the shortest drive of all of you visitors, probably. We've got a full schedule for the rest of the day that Jonah's gonna walk you through, and I really wanna thank you for taking the time to be here with us, and I hope it was productive for all of you as well. We're trying to share with you as much as we can that is reliable and candidly and as forthcoming as possible. The things that we don't have control over, I will not go out on a limb and provide something that I don't feel comfortable with, that is not something that we can count on. That's why there's this. Some questions that the clarity and the level of accuracy is just not in our hands. You know, there's only so much we can do, and, you know, I believe in a very transparent relationship with all of our shareholders and analysts, and we wanna help you get it right to the extent that we possibly can do that for you, with you. That's our policy, that's our intent, and I wanna thank you for working with us on that. Okay. Thank you very much, Wahid. I wanna echo Wahid's comments. We really appreciate all of you taking the time out of your busy schedules to travel out here to see us on the West Coast, to visit our facilities, and to spend some time with us this morning.